LightPath Technologies Announces Financial Results for the Second Quarter and First Half of Fiscal 2009

ORLANDO, FL--(Marketwire - February 12, 2009) - LightPath Technologies, Inc. (NASDAQ: LPTH), a
manufacturer and integrator of families of precision molded aspheric
optics, GRADIUM® glass products, and high-performance fiber-optic
collimators and isolators, today announced financial results for the second
quarter and first half of fiscal 2009 ended December 31, 2008.

Second Quarter Highlights:

-- Disclosure backlog scheduled to ship within the next twelve months is
$3.0 million similar to the backlog level at September 30, 2008
-- The second quarter revenue was $1.91 million compared to $2.02
million, a decrease of 6% from the same period last year, and was impacted
by a $400,000 order cancellation from a major customer whose end customer
filed bankruptcy
-- Second quarter fiscal 2009 gross margin improves to 25% compared to 0%
for the same period in the previous fiscal year
-- The second quarter EBITDA improved to a loss of $700,000 compared to a
loss of $1.5 million in the same period last year
-- Cash usage was reduced to $631,000 in the second quarter of fiscal
2009 from a usage of $1.4 million in the same quarter in the prior year
-- The legal suit filed in October 2007 by Harborview has been dismissed
in federal court

Mr. Jim Gaynor, Chief Executive Officer of LightPath, commented, "During
the second quarter of fiscal 2009 we faced financial challenges along with
many in the industries we do business with, as the worldwide economic
instability continued to create turbulence in the market. I am pleased
that we were able to continue to manage our costs and increase our gross
margins year over year. This is a good indication of how efficiently the
business we have been operating over the past few quarters has become
despite the market challenges we are facing. Our gross margin for the
second quarter of fiscal 2009 improved from 0% to 25% compared to the
second quarter of fiscal 2008, and to 26% for the first half of fiscal
2009, compared to 6% the first half of fiscal 2008."

"We have improved our gross margins as a result of the cost reduction
programs we have implemented. During the second quarter of fiscal year
2009, over 96% of our precision molded optics were produced at our Shanghai
facility. Direct labor productivity has improved 71% in our Shanghai
factory. This efficiency improvement combined with the high percentage of
product now produced in this facility has significantly reduced our labor
cost. Production yields for the first half of fiscal 2009 averaged 85%
compared to an average of 67% for the fiscal year 2008. We are also
continuing to convert to high temperature lower cost glass materials and
this conversion combined with the 18 percentage point improvement in yield
has lowered our material costs. We have also implemented new programs to
reduce our service costs aimed at tooling and our anti-reflective coating
processes. As these programs come on line we expect to see continued
improvement in our already low direct costs in future quarters.

"In addition to these direct cost reductions we have implemented a series
of overhead cost reductions. With the transfer of our manufacturing
operations to Shanghai workforce in Orlando has been reduced by 38% since
December 2007. And as a result of the productivity improvements in Shanghai
we have reduced the workforce there by 20% in December 2008. In addition
we implemented a 10% salary reduction for the majority of our US based
personnel in January 2009.

"The result of all of these changes has resulted in a reduction of our cash
used in operations by 49% from the first fiscal quarter of 2009 to the
second fiscal quarter of 2009. If the impacts of our implemented
efficiencies had been in place for the full quarter our cash used in
operations would have been below $300,000, as compared to actual cash used
in the quarter of $771,000. As the full impact of these improvements are
realized and our forecasted revenues are achieved we believe we will see
continued reductions of cash used in operations at least 50% again over the
next two quarters. This improvement is expected to continue for the
remainder of fiscal 2009 providing significant organic growth opportunity,"
further commented Mr. Gaynor.

Financial Results for Three Months Ended December 31, 2008

Revenue for the second quarter of fiscal 2009 ended December 31, 2008
totaled $1.9 million compared to $2.0 million for the second quarter of
fiscal 2008, a decrease of 6%. The decrease from the second quarter of last
year was primarily attributable to lower sales volumes of molded optics
products, collimators and gradium products, offset by higher sales volumes
of isolators. The reduction in molded optics sales volume was primarily
attributed to an order cancellation related to a bankruptcy of an end user
of our major customer and we do not expect this level of impact to occur
again given the nature of our backlog. Growth in sales going forward is
expected to be derived primarily from the precision molded optics product
line driven by low cost lenses in Asia.

Our gross margin percentage in the second quarter of fiscal 2009 compared
to second quarter fiscal 2008 increased to 25% from 0%. Total manufacturing
cost of $1.4 million was $0.6 million lower in the second quarter of fiscal
2009 compared to the same period of the prior fiscal year. Direct costs,
which include material, labor and services, remain stable at 22% of revenue
in the second quarter of fiscal 2009, as compared to 24% in the second
quarter of fiscal 2008. Gross margins improved as a result of the cost
reduction programs the Company has implemented. In addition, we incurred a
one-time inventory valuation adjustment of approximately $374,000 for the
quarter ended December 31, 2007 that was not incurred during the quarter
ended December 31, 2008.

During the second quarter of fiscal 2009 total costs and expenses decreased
$326,000 to $1.3 million compared to $1.7 million for the same period in
fiscal 2008. Included in total costs and expenses for fiscal 2009 were $1.1
million in selling, general and administrative expenses which for the
second quarter of fiscal 2009 decreased $245,000 or 18% from $1.4 million
for the same period in the prior year. As a result, total operating loss
for the second quarter of fiscal 2009 improved to $0.9 million compared to
a loss of $1.7 million for the same period in fiscal 2008.

Net loss for the second quarter of fiscal 2009 ended December 31, 2008 was
$1.7 million or $0.29 per basic and diluted share, compared with a net loss
of $1.6 million or $0.31 basic and diluted per share for the same period in
fiscal 2008. This compared to a net loss of $1.0 million or $0.19 per basic
and diluted share for the first quarter of fiscal 2009 ended September 30,
2008. This represents an $82,000 increase in net loss. The net loss for the
quarter ended December 31, 2008 includes $641,000 in charges related to
fees, debt costs, and debt discount write-offs associated with the
conversion of 25% of outstanding debentures into common stock.
Weighted-average shares outstanding increased in the second quarter of
fiscal 2009 compared to the second quarter in fiscal 2008 primarily due to
the issuance of common shares related to the debenture conversion.

Financial Results for the Six Months Ended December 31, 2008

Revenue for the six months ended December 31, 2008 totaled $4.2 million
compared to $4.3 million for the first six months of fiscal 2008, a
decrease of 2%. The decrease from last year was primarily attributable to
lower sales volumes of collimators and gradium, products, partially offset
by higher sales volumes of isolators. Growth in sales going forward are
expected to be derived primarily from the precision molded optics driven by
low cost lenses in Asia.

Our gross margin percentage in the first half of fiscal 2009 compared to
first half of fiscal 2008 increased to 26% from 6%. Total cost of sales was
$3.1 million which represents a $941,000 decrease in the first half of
fiscal 2009 compared to $4.1 million in the same period of the prior fiscal
year. Direct costs, which include material, labor and services, remain
stable at 23% of revenue in the first half of fiscal 2009, as compared to
22% in the first half of fiscal 2008. Gross margins improved as a result
of the cost reduction programs the Company has implemented. In addition,
we incurred a one-time inventory valuation adjustment of approximately
$374,000 for the six months ended December 31, 2007 that was not incurred
during the six months ended December 31, 2008.

During the first half of fiscal 2009 total costs and expenses decreased
approximately $573,000 to $2.8 million compared to $3.4 million for the
same period in fiscal 2008. Included in total costs and expenses for the
first half of fiscal 2009 were $2.3 million in selling, general and
administrative expenses which decreased $452,000 to $2.3 million compared
to $2.8 million for the same period in the prior fiscal year. As a result,
total operating loss for the first half of fiscal 2009 improved to $1.8
million compared to $3.2 million for the same period in fiscal 2008.

Net loss for the six months ended December 31, 2008 totaled $2.8 million or
$0.49 per basic and diluted share, compared with a net loss of $3.1 million
or $0.59 basic and diluted per share for the same period in fiscal 2008.
This represents a $397,000 decrease in net loss. The net loss for the first
half includes $641,000 in charges related to fees, debt costs, and debt
discount write-offs associated with the conversion of 25% of the
outstanding debentures. Weighted-average shares outstanding increased in
the first half of fiscal 2009 compared to the first half of fiscal 2008
primarily due to the issuance of common shares related to the conversion of
the debentures.

On the balance sheet, cash and cash equivalents totaled $523,509 at
December 31, 2008. Total current assets and total assets at December 31,
2008 were $3.6 million and $5.9 million compared to $3.3 million and $5.5
million at June 30, 2008, respectively. Total current liabilities and total
liabilities at December 31, 2008 were $1.8 million and $3.3 million
compared to $3.0 million and $3.3 million, respectively, for June 30, 2008.
As a result, the current ratio as of December 31, 2008 improved to 2.0 to 1
compared to 1.10 to 1 for the year end June 30, 2008. Total stockholders'
equity at December 31, 2008 totaled $2.61 million compared to $2.2 million
at June 30, 2008.

As of December 31, 2008 the Company's backlog of orders to be filled in
less than one year, was to $3.0 million compared to $3.2 million as of
September 30, 2008.

Jim Gaynor concluded, "On January 30, 2009 the district court in New York
dismissed all claims of the lawsuit by Harborview. We are pleased with the
court's decision and to have this lawsuit completed.

"Our results for the first half of this year are a positive reflection of
much hard work and effort by the team at LightPath, to control cost and
mitigate expenses. Despite a marginal decrease in our revenues we managed
to dramatically enhance our gross margins and decrease our loss over the
previous year. We expect the full effect of the efficiencies we have
implemented will bring cash usage going forward lower than the current
second quarter of fiscal 2009. Our cash balance at December 31, 2008 was
$523,000. We remain confident that the changes we have made over the past
year will reap positive rewards as we generate more sales and build our
pipeline of business. We remain encouraged by our disclosure backlog at
$3.0 million, and the number of new product proposals we have undertaken in
the past six months. Our efforts to penetrate high volume lower cost
commercial markets in Asia show tremendous promise for the second half of
our fiscal year. Going forward we will continue our focus on the lower cost
higher volume market opportunities and broaden our exposure in the Asian
precision optic lens market."

Investor Conference Call and Webcast Details:

LightPath will host an audio conference call and webcast on Thursday,
February 12th at 4:15 p.m. EST to discuss the Company's financial and
operational performance for the second quarter and first half of fiscal
2009.

It is recommended that participants dial-in approximately 5 to 10 minutes
prior to the start of the 4:15 p.m. call. The call is also being webcast
and may be accessed at LightPath's website at www.lightpath.com. A
transcript archive of the webcast will be available for viewing or download
on the company web site shortly after the call is concluded.

About LightPath Technologies

LightPath manufactures optical products including precision molded aspheric
optics, GRADIUM® glass products, proprietary collimator assemblies, laser
components utilizing proprietary automation technology, higher-level
assemblies and packing solutions. LightPath has a strong patent portfolio
that has been granted or licensed to us in these fields. LightPath common
stock trades on the NASDAQ Capital Market under the stock symbol LPTH. For
more information visit www.lightpath.com

EBITDA is a non-GAAP financial measure used by management, lenders and
certain investors as a supplemental measure in the evaluation of some
aspects of a corporation's financial position and core operating
performance. Investors sometimes use EBITDA as it allows for some level of
comparability of profitability trends between those businesses differing as
to capital structure and capital intensity by removing the impacts of
depreciation and amortization. EBITDA also does not include changes in
major working capital items such as receivables, inventory and payables,
which can also indicate a significant need for, or source of, cash. Since
decisions regarding capital investment and financing and changes in working
capital components can have a significant impact on cash flow, EBITDA is
not a good indicator of a business's cash flows. We use EBITDA for
evaluating the relative underlying performance of the Company's core
operations and for planning purposes. We calculate EBITDA by adjusting net
loss to exclude net interest expense, income tax expense or benefit,
depreciation and amortization, thus the term "Earnings Before Interest,
Taxes, Depreciation and Amortization" and the acronym "EBITDA."

This news release includes statements that constitute forward-looking
statements made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. This information may involve
risks and uncertainties that could cause actual results to differ
materially from such forward-looking statements. Factors that could cause
or contribute to such differences include, but are not limited to, factors
detailed by LightPath Technologies, Inc. in its public filings with the
Securities and Exchange Commission. Except as required under the federal
securities laws and the rules and regulations of the Securities and
Exchange Commission, we do not have any intention or obligation to update
publicly any forward-looking statements, whether as a result of new
information, future events or otherwise.

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